Three important lessons learned from Bridj’s closure

Doug Kaufman May 10, 2017 Public Transportation, Industry Thoughts, TransLoc Blog 0 Comments

Last week, Bridj made news by shutting its doors. By collecting and using data to create a more demand-driven transit world, Bridj tried to create a “network of express shuttles that offer efficient and flexible trips…that adapt in real-time to where you live, work, and play.” In Boston and Washington, this meant point-to-point trips that filled in gaps that were underserved by public transit. To me, this is a compelling vision for the future of transit.

At a company level, TransLoc never considered Bridj a competitor. At a personal level, although I followed the Bridj story in the media and read blog posts about their service, I didn’t know them well. I only met Matt George, the CEO of Bridj, once. We sat on a panel together at the Shared Use Mobility Summit in 2015. Since I hate boring panels, I often encourage fellow panelists to disagree and engage in spirited debate. That’s exactly what Matt and I did on that particular panel—we challenged each other on key ideas and perspectives in a professional and cordial way. Matt didn’t disappoint and our audience was the beneficiary.

As a CEO, when a company in the same industry goes out of business, it’s imperative to pay attention, understand the why’s as well as the what’s of the situation, and determine if there’s a larger concern that might impact your own company and others in your space. As I think about Bridj and the lessons surfaced by their recent closure, I see three key take-aways for those of us trying to solve the world’s mobility challenges:

Lesson #1: Direct to consumer is challenging and expensive

Bridj served Boston for three years and Washington, DC for a shorter time. (They announced they were going to Austin, but never actually opened there.) In each of these markets, Bridj had to hire operators, marketers, and build a consumer base from scratch. That’s difficult, expensive, and high-risk.  

Similarly, if you go direct-to-consumer, you need to achieve great scale–and if you raise outside capital, as Bridj had, you may need to achieve that scale quickly. Although Uber and Lyft have a different model (a distributed, contracted labor force), they have turned the corner on scale. As a for-profit company, never turning that corner can put you in a difficult position. Eventually, the cost to run demand-driven shuttles will become unsustainably high whether they are full or empty.

Transit agencies move millions of people each day across the US and it’s important for transit technology companies to partner with them. Beyond assets and labor, agencies have a precious commodity: the millions of riders who depend on them each day. In working alongside agencies and not in competition with them, tech companies, like ours, are able to avoid the high customer acquisition costs associated with gaining one rider at a time.

Lesson #2: Transit agencies are the “secret weapon” to transforming transportation

Bridj’s focus on pop-up, point-to-point transit aimed to fill a gap left by public transit. However, because Bridj’s service didn’t tie directly into the larger transit network in Boston or Washington it reduced the available market as well as the value of the service itself. Even Bridj’s pilot with the Kansas City Area Transportation Authority was scoped to just two sections of the city, necessarily reducing the number of people who could use the program and where those people could go.

At TransLoc, we believe the path to achieving seamless mobility for all begins with transit agencies. Our success depends on empowering them to succeed as part of a larger transportation ecosystem. Whether that is how we’re complementing fixed-route university shuttles with on-demand safe ride vehicles or how we’ve integrated Uber with public transit, we’re careful to ensure that no one mode exists in a vacuum, but instead connects to the larger transportation ecosystem. We see transit as the heart of this ecosystem.

Lesson #3: There is no silver bullet

Communities across the US are facing complex problems with access to jobs, infrastructure, and economic disparities, among others. It’s easy to look at technology and think that the simple application of it to transportation will be a cure-all. We recognize that is a red herring.

In highly complex markets like transit, the easy problems have already been solved. What’s left are hard problems that don’t always fit into neat little boxes and often require disparate skillsets and diverse approaches to solving. Being too narrowly focused with those solutions can lead to products that don’t adequately solve the real problems in the market.

As an entrepreneur, I respect and applaud the risks Matt and his team took to start Bridj and the hard work they put in to serve riders. And while Matt and his team may have approached the problem differently than us, I salute their work.

It’s said that progress isn’t always a straight line. That certainly is true. There’s no guaranteed approach to success, but any company that hopes to transform mobility needs a clear vision of the world they want to create and work tirelessly towards actualizing that vision every day. For us, at TransLoc, our vision of the future includes a thriving and seamless public transportation network for all.

Tags: Public Transportation, Industry Thoughts, TransLoc Blog

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